Health reform is a good start to save money, provide care

Speak Out

JAMES BOURQUE MAIN STREET, HOLDEN

It is not surprising that there is a lot of misinformation out there about healthcare reform in general and Medicare in particular. Still, the words of Sen. Daniel Patrick Moynihan ring true: “Everyone is entitled to their own opinion; everyone is not entitled to their own facts.”

Some thoughtful people, however, are trying to set the facts straight. The New England Council, an 80-yearold partnership of business, academic, and healthcare organizations, has issued a clear, if brief, paper on the general subject. It is available at their Web site newenglandcouncil.org and is worth reading.

There is much misinformation on the specific issue of Medicare and the savings derived from changes to the program. Can we look at the facts? Since 1997, Medicare Advantage plans have been offered through private insurance companies as competition to Traditional Medicare. Medicare Advantage plans have offered benefits not available to Traditional Medicare recipients.

A key issue is this: Medicare Advantage premiums are paid by everyone who contributes to Medicare. They do so at a rate 12-14 percent higher than that paid to Traditional Medicare providers. In return, the insurance companies charge us an overhead 10 percent, significantly higher than that of Traditional Medicare. They spend only 83 percent of revenue on actual healthcare costs, much lower than the percentage devoted to care in the Traditional Medicare program. These statistics are verified in a 2006 study by the Government Accountability Office.

Bringing the Medicare Advantage payments into line with Traditional Medicare will produce major savings. Other savings will be realized in tying payments to quality outcomes.

In addition to savings, there are improved services. Of great importance to seniors is reform of the Medicare Prescription Plan that relies totally on the market and forces participants to pay for all medications when they fall into the infamous “doughnut hole.” Another major reform is the offering of annual physicals at no costs through Medicare.

Add to these considerations the general benefits of the bill — preexisting conditions will be covered, children can stay on their parents’ plan through age 26, and lifetime limits and the ability of insurers to terminate coverage except in the case of fraud are eliminated — and you have a good start toward reform. Millions more will be covered, small business will receive tax credits to help them pay for covering employees, and states will form exchanges as Massachusetts has to help people find coverage.

It is not perfect, but it promises a much better system, one that can be improved by our children and our future leaders.